Renishaw scraps final dividend, sales slide at Morgan Advanced Materials

Stocks to watch

Scientific engineer Renishaw scrapped its final dividend in response to the coronavirus crisis as it looked to control costs. The company on Friday said it would “review its position on dividends during the next fiscal year with the intention of reinstating the dividend as soon as it is appropriate to do so”, adding that current trading remained in line with expectations.

Morgan Advanced Materials updated the market on its trading amid the Covid-19 pandemic on Friday, reporting that sales for the 21 weeks from 1 January to 24 May were 8.8% lower on an organic constant-currency basis, compared to the same period last year. The FTSE 250 company said that reflected a 3.2% decline in the first quarter, largely driven by shut-downs in China, followed by a decline of 19.5% in April and May, as the impact of Covid-19 was felt more widely across the group.

Taylor Wimpey said its order book was strong with a healthy increase in reservations in recent weeks and strong demand for appointments at reopened show homes.The FTSE 100 housebuilder said most of its construction sites, sales centres and show homes had reopened. Scottish construction sites are preparing to reopen in line with guidance. The UK order book has continued to increase and was £2.8bn at the end of May, up from £2.5bn a year earlier.

Newspaper round-up

Northern Ireland business groups are calling for a six month delay to Brexit checks in the Irish Sea saying that Boris Johnson’s late admission that he is legally obliged to implement them has left them no time to prepare for the December cliff edge. They have also hit out at Downing Street secrecy, saying they are refusing to discuss the plans with the very people that needed to implement them. – Guardian

Rail passengers can now be warned of busy trains and stations before they leave home as part of a UK industry system designed to help maintain physical distancing and safe travel during the coronavirus pandemic. The technology will combine data on journey trends and live updates from station staff, to both inform passengers searching for journeys on the National Rail website and app, and alert those who opt in for updates on specific journeys, using their anonymised data to help predict how busy each train will be. – Guardian

Britain has been urged to follow Germany’s lead after it unveiled plans to slash VAT as part of a massive stimulus package to escape the coronavirus recession. Angela Merkel has launched a €130bn (£117bn) rescue programme that includes a temporary cut in VAT from 19pc to 16pc, as well as €50bn for rail and broadband networks and electric car subsidies. – Telegraph

A slew of European titans have taken advantage of a debt lifeline offered by the Bank of England, including Dulux maker Akzo Nobel, chemicals company Bayer and Chanel. Household names from aviation, retail and industry were among the 53 companies to borrow £16.2bn under the Covid Corporate Financing Facility (CCFF), the Bank revealed in its first week of naming firms. – Telegraph

he German chemicals giant BASF has emerged as the largest recipient of the Bank of England’s Covid-19 emergency funding scheme despite only employing 834 people in Britain. The company, which is valued at €50 billion, has borrowed £1 billion from the Bank, equivalent to nearly £1.2 million for each of its UK workers. - The Times

US close

Wall Street stocks closed mostly lower on Thursday after the Labor Department published some more disappointing unemployment claims data.

At the close, the Dow Jones Industrial Average was up 0.05% at 26,281.82, while the S&P 500 was 0.34% softer at 3,112.35 and the Nasdaq Composite saw out the session 0.69% at 9,615.81.

The Dow closed just 11.93 points higher on Thursday, halting a rally that peaked yesterday on growing optimism regarding the reopening of several US states.

Thursday's main focus was the Department of Labor's latest unemployment claims data, which revealed layoffs in the US continued at a furious but slightly slower pace last week.

Initial unemployment claims during the week ending on 30 May dropped by 249,000 to reach 1.877m (consensus: 1.75m). Last week 2.1m Americans lodged new claims. The four-week moving average meanwhile, which aims to smooth out the variations from one week to the next, fell by 324,750 to 2.284m.

Protests across the US as a result of the death of unarmed African-American man George Floyd at the hands of Minneapolis police officer Derek Chauvin, rising tensions between Washington and Beijing and the ongoing Covid-19 pandemic were all very much so still in focus as well.

Market participants also kept a keen eye on moves across the pond, with the European Central Bank's policy decision surprising markets with a larger-than-expected increase in its bond-buying programme against the pandemic.